ALASKA STATE LEGISLATURE
SENATE RESOURCES STANDING COMMITTEE
April 9, 2012
3:36 p.m.
MEMBERS PRESENT
Senator Joe Paskvan, Co-Chair
Senator Thomas Wagoner, Co-Chair
Senator Bill Wielechowski, Vice Chair
Senator Hollis French
Senator Gary Stevens
MEMBERS ABSENT
Senator Bert Stedman
Senator Lesil McGuire
OTHER LEGISLATORS PRESENT
Senator Cathy Giessel
COMMITTEE CALENDAR
CONFIRMATION HEARINGS
Board of Fisheries
Karl Johnstone - Anchorage, AK
Orville Huntington - Huslia, AK
- CONFIRMATIONS ADVANCED
CS FOR HOUSE JOINT RESOLUTION NO. 26(RES) AM
Urging federal agencies to work with the Alaska Department of
Fish and Game, Southeast Alaska Native leaders, and other
interested parties to establish strategies and plans for the
sustainable management of the reintroduced sea otter population
of Southeast Alaska.
- MOVED CSHJR 26(RES) AM OUT OF COMMITTEE
COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 118(FIN)
"An Act relating to a tax credit for qualified research and
development expenditures; and providing for an effective date."
- HEARD & HELD
SENATE BILL NO. 207
"An Act relating to exemptions for a resident hunting and sport
fishing license and to taking fish and game by proxy for a
person with mental or physical disabilities."
- SCHEDULED BUT NOT HEARD
SENATE BILL NO. 209
"An Act relating to oil and gas or gas only leasing; requiring
that a minimum work commitment be included in each oil and gas
and gas only lease and that a proposed plan of development be
included in an application for an oil and gas or gas only lease;
and providing for an effective date."
- SCHEDULED BUT NOT HEARD
PREVIOUS COMMITTEE ACTION
BILL: HJR 26
SHORT TITLE: SEA OTTER MANAGEMENT
SPONSOR(s): REPRESENTATIVE(s) P.WILSON
03/31/11 (H) READ THE FIRST TIME - REFERRALS
03/31/11 (H) RES
02/03/12 (H) RES AT 1:00 PM BARNES 124
02/03/12 (H) Heard & Held
02/03/12 (H) MINUTE(RES)
02/13/12 (H) RES AT 1:00 PM BARNES 124
02/13/12 (H) Moved CSHJR 26(RES) Out of Committee
02/13/12 (H) MINUTE(RES)
02/15/12 (H) RES RPT CS(RES) 6DP 2NR 1AM
02/15/12 (H) DP: MUNOZ, FOSTER, P.WILSON, DICK,
SEATON, FEIGE
02/15/12 (H) NR: GARDNER, HERRON
02/15/12 (H) AM: KAWASAKI
03/19/12 (H) DIVIDE THE AMENDMENT UC
03/19/12 (H) DIVIDE AM NO 1A WITHDRAWN
03/19/12 (H) TRANSMITTED TO (S)
03/19/12 (H) VERSION: CSHJR 26(RES) AM
03/21/12 (S) READ THE FIRST TIME - REFERRALS
03/21/12 (S) RES
04/04/12 (S) RES AT 3:30 PM BUTROVICH 205
04/04/12 (S) Heard & Held
04/04/12 (S) MINUTE(RES)
04/09/12 (S) RES AT 3:30 PM BUTROVICH 205
BILL: HB 118
SHORT TITLE: RESEARCH AND DEVELOPMENT TAX CREDIT
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR
01/24/11 (H) READ THE FIRST TIME - REFERRALS
01/24/11 (H) L&C, FIN
02/18/11 (H) L&C AT 3:15 PM CAPITOL 106
02/18/11 (H) Heard & Held
02/18/11 (H) MINUTE(L&C)
02/25/11 (H) L&C AT 3:15 PM BARNES 124
02/25/11 (H) Scheduled But Not Heard
03/11/11 (H) L&C AT 3:15 PM BARNES 124
03/11/11 (H) Moved CSHB 118(L&C) Out of Committee
03/11/11 (H) MINUTE(L&C)
03/14/11 (H) L&C RPT CS(L&C) 5DP 1NR
03/14/11 (H) DP: THOMPSON, SADDLER, JOHNSON, MILLER,
OLSON
03/14/11 (H) NR: CHENAULT
03/14/11 (H) L&C AT 3:15 PM BARNES 124
03/14/11 (H) <Bill Hearing Canceled>
04/07/11 (H) FIN AT 8:30 AM HOUSE FINANCE 519
04/07/11 (H) Heard & Held
04/07/11 (H) MINUTE(FIN)
04/08/11 (H) FIN AT 9:00 AM HOUSE FINANCE 519
04/08/11 (H) -- MEETING CANCELED --
02/06/12 (H) FIN AT 1:30 PM HOUSE FINANCE 519
02/06/12 (H) Heard & Held
02/06/12 (H) MINUTE(FIN)
02/13/12 (H) FIN AT 1:30 PM HOUSE FINANCE 519
02/13/12 (H) Moved CSHB 118(FIN) Out of Committee
02/13/12 (H) MINUTE(FIN)
02/15/12 (H) FIN AT 1:30 PM HOUSE FINANCE 519
02/15/12 (H) Moved CSHB 118(FIN) Out of Committee
02/15/12 (H) MINUTE(FIN)
02/17/12 (H) FIN RPT CS(FIN) NT 2DP 4NR 3AM
02/17/12 (H) DP: NEUMAN, COSTELLO
02/17/12 (H) NR: T.WILSON, EDGMON, STOLTZE, THOMAS
02/17/12 (H) AM: GARA, GUTTENBERG, DOOGAN
02/29/12 (H) BEFORE THE HOUSE WITH AM NO 1 PENDING
03/02/12 (H) TRANSMITTED TO (S)
03/02/12 (H) VERSION: CSHB 118(FIN)
03/05/12 (S) READ THE FIRST TIME - REFERRALS
03/05/12 (S) RES, FIN
04/04/12 (S) RES AT 3:30 PM BUTROVICH 205
04/04/12 (S) Scheduled But Not Heard
04/06/12 (S) RES AT 4:30 PM BUTROVICH 205
04/06/12 (S) Scheduled But Not Heard
04/09/12 (S) RES AT 3:30 PM BUTROVICH 205
WITNESS REGISTER
REPRESENTATIVE PEGGY WILSON
Alaska State Legislature
Juneau, AK
POSITION STATEMENT: Sponsor of HJR 26.
KARL JOHNSTONE, Nominee
Board of Fisheries
Anchorage, AK
POSITION STATEMENT: Testified as nominee for reappointment to
the Board of Fisheries.
ORVILLE HUNTINGTON, Nominee
Board of Fisheries
Huslia, AK
POSITION STATEMENT: Testified as nominee for reappointment to
the Board of Fisheries.
BRIAN KRAFT, representing himself
Anchorage, AK
supported
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
HEATH HILYARD, Executive Director
Southeast Alaska Guides Organization
Juneau, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
RON PORTER, representing himself
Sitka, AK
POSITION STATEMENT: Opposed the reappointment of Mr. Johnstone
to the Board of Fisheries.
STAN MALCOM, President
Petersburg Charter Boat Association
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
DAN ERNHART, Executive Director
Tsiu River Coalition
Cordova, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
GREG ROCZICKA, representing himself
Bethel, AK
POSITION STATEMENT: Supported the reappointment of both Mr.
Johnstone and Mr. Huntington to the Board of Fisheries.
LARRY ENGEL, representing himself
Palmer, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
TERRY ELLIS, representing himself and family
Wasilla, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
AL BARRETTE, representing himself
Fairbanks, AK
POSITION STATEMENT: Did not oppose the reappointment of Mr.
Johnstone to the Board of Fisheries.
ANDY SZCZESNY, representing himself
Soldotna, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
STEVEN MCCLURE, representing himself
Soldotna, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
JOE CONNORS, representing himself
Sterling, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
GARY CHAMBERLIN, representing himself
Sterling, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
MONTE ROBERTS, representing himself
Soldotna, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
MURRAY FENTON, representing himself
Sterling, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
MIKE CRAWFORD, representing himself
Soldotna, AK
POSITION STATEMENT: Supported the reappointment of both Mr.
Huntington and Mr. Johnstone to the Board of Fisheries
STEVEN RUNYAN, Chair
Susitna Valley Advisory Committee
Palmer, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
BRUCE KNOWLES, member
Susitna Valley Fish and Game Advisory Committee and
MatSu Borough Game and Fish Commission
Willow, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
LORETTA BULLARD
Kawerak, Inc.
Nome, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
RICHARD YAMADA, President
Juneau Charter Boat Operators Association
Juneau, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
GEORGE PIERCE, representing himself
Kasilof, AK
POSITION STATEMENT: Did not support the reappointment of Mr.
Johnstone to the Board of Fisheries.
RON SOMERVILLE, board member
Territorial Sportsmen
Juneau, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
PAUL SHADURA, Executive Director
Kenai Peninsula Fishermen's Association (KPFA)
Soldotna, AK
POSITION STATEMENT: Was neutral on the reappointment of Mr.
Johnstone to the Board of Fisheries.
RIKI GEESE, Executive Director
Kenai River Sportfishing Association
Soldotna, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
BILL BROWN, Vice Chair
Board of Fisheries
Juneau, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
REUBEN HANKE, representing himself
Soldotna, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
JIM STUBBS, Vice Chair
Anchorage Fish and Game Advisory Committee
Anchorage, AK
POSITION STATEMENT: Supported the reappointment of Mr. Johnstone
to the Board of Fisheries.
WYNETTA AYERS, Director
Division of Economic Development
Department of Commerce, Community and Economic Development
(DCCED), Juneau, AK
POSITION STATEMENT: Provided information related to HB 118.
JOHANNA BALES, Deputy Director
Tax Division
Department of Revenue (DOR)
Anchorage, AK
POSITION STATEMENT: Provided information related to HB 118.
ACTION NARRATIVE
3:36:44 PM
CO-CHAIR THOMAS WAGONER called the Senate Resources Standing
Committee meeting to order at 3:36 p.m. Present at the call to
order were Senators Stevens, French, Wielechowski, Co-Chair
Paskvan and Co-Chair Wagoner.
HJR 26-SEA OTTER MANAGEMENT
3:37:44 PM
CO-CHAIR WAGONER announced consideration of HJR 26 [CSHJR
26(RES)am was before the committee].
REPRESENTATIVE PEGGY WILSON, sponsor of HJR 26, said this
resolution was presented last week and Co-chair Wagoner asked
what had happened when it was heard in the House Committee. She
said that out of 11 testimonies, 8 were in support and 3 animal
activists didn't like it. Initially, Native leaders had some
concerns about the third resolve clause regarding the use of sea
otter pelts and she worked with Sealaska to rewrite that. Most
of the testifiers agreed that a plan is needed to deal with
increase in sea otter problem. That is what this resolution
does.
REPRESENTATIVE P. WILSON said she was not advocating any
particular solution, but rather encouraging stakeholders -
state, federal, Native peoples and the public - to come to the
table to find a solution.
3:39:38 PM
SENATOR FRENCH said he heard from some people that this is
predator control for sea otters.
REPRESENTATIVE P. WILSON said she hadn't heard that at all and
that was not the intent.
SENATOR FRENCH said subsistence use is the only direct reference
he saw for harvesting on page 3, line 28.
REPRESENTATIVE P. WILSON added that now only Natives can harvest
pelts and sell them and they want to change the definition only
so they can have a niche market.
CO-CHAIR WAGONER asked if a person could legally harvest a
certain number of sea otters.
REPRESENTATIVE P. WILSON replied there is no set number.
3:42:04 PM
CO-CHAIR PASKVAN moved to report CSHJR 26(RES)am, version D.A,
from committee to the next committee of referral with individual
recommendations and attached fiscal note.
SENATOR WIELECHOWSKI remarked that he had also received a number
of messages of concern about predator control.
REPRESENTATIVE P. WILSON said she hadn't heard an inkling of
that thought; it was never mentioned.
CO-CHAIR WAGONER removed his objection and finding no further
objection announced that CSHJR 26(RES)am moved from Senate
Resources Standing Committee.
3:43:53 PM
At ease from 3:43 to 3:44 p.m.
^Confirmation hearings
Confirmation hearings
3:44:45 PM
CO-CHAIR WAGONER announced consideration of the Governor's
appointees for the Board of Fisheries: Karl Johnstone and
Orville Huntington.
3:45:21 PM
KARL JOHNSTONE, nominee for reappointment to the Board of
Fisheries, Anchorage, AK, said that he came to Alaska directly
out of law school in March 1967 when he received a job offer. He
quickly discovered Alaska was the place for him for many reasons
connected to outdoor opportunities. He has been here ever since
and intends on staying for the foreseeable future.
MR. JOHNSTONE said that he practiced law from 1967 until 1979
when he was appointed to the Supreme Court where he served until
the late 90s. The last four of those years he served as a
presiding judge for the Third Judicial District. After retiring
he had a very limited law practice as a mediator. He did that
until he was appointed to the Board of Fisheries in December
2008 to serve out Jeremiah Campbell's term of one year. Then he
was appointed to a full three-year term where he has been
serving since. In October 2011 he was elected chair.
When he first was appointed he thought he knew a lot about the
fisheries resource in the state having fished in Bristol Bay and
Southeast and Prince William Sound, but experienced a steep
learning curve. He said he was willing to serve for another
term.
CO-CHAIR WAGONER thanked Mr. Johnstone and invited Mr.
Huntington to testify.
3:49:34 PM
ORVILLE HUNTINGTON, nominee for the Board of Fisheries, Huslia,
AK, said he had been around fishing all his life and had good
teachers. They are not the kind of people who talk about
themselves, but he got a wildlife degree and understands
fisheries issues. He said they have to base their best decisions
on science and take local concerns into consideration. However,
conservation should always be the goal. He was honored that the
governor nominated him.
3:51:20 PM
BRIAN KRAFT, representing himself, Anchorage, AK, said he owned
three sportfishing lodges in Alaska and supported the
reappointment of Mr. Johnstone to the Board of Fisheries. He had
always been fair and willing to listen to his proposals and
while he didn't always agree with him, he understood that the
resource comes first. He understood the economic needs of the
commercial fisheries and the sport fisheries keeping subsistence
in the forefront and had a tremendous track history. Being a
judge gives him a great vantage point in which to look through
the facts and come to a fair and equitable determination.
3:53:02 PM
HEATH HILYARD, Executive Director, Southeast Alaska Guides
Organization, Juneau, AK, supported the reappointment of Mr.
Johnstone to the Board of Fisheries. He experienced the same
honesty and directness as Mr. Kraft had when attending the March
Ketchikan Board of Fisheries meeting. He puts the overall health
of the resource first and made himself available to various
stakeholder groups and members of the public throughout that 10-
day meeting.
3:55:08 PM
RON PORTER, representing himself, Sitka, AK, opposed the
reappointment of Mr. Johnstone to the board of Fisheries. He has
a vendetta against Southeast commercial fisheries and was a poor
choice for chair. He had been to two meetings and thought it was
becoming non-functional.
3:56:43 PM
STAN MALCOM, President, Petersburg Charter Boat Association,
supported the reappointment of Mr. Johnstone to the Board of
Fisheries. Mr. Malcom said he owned charter boat business in
Petersburg and was concerned about long-term sustainability of
the resource. Mr. Johnstone's interest in how the department
manages the resources is more than just an automatic endorsement
of their recommendations. While he didn't agree with his every
position, he saw no bias towards any particular user group. He
is readily available to the public and his professionalism is
the best he had seen in over 20 years of attending board
meetings.
3:58:24 PM
DAN ERNHART, Executive Director, Tsiu River Coalition, Cordova,
AK, supported the reappointment of Mr. Johnstone to the Board of
Fisheries. He was impressed with the way he handled meetings
when he was chair. He has a good sense of timing and pacing; he
is very knowledgeable about most of the fisheries around the
state. He votes on what is fair and what is right and not what
is expected, and his explanations of why he voted are very
understandable to a layperson. Being a former judge has given
him a thick skin and he is not easily intimidated or weak when
special interests try to get to him. It's clear that experience
on the board is critical to making informed long-term decisions;
constant turnover is counterproductive.
4:00:31 PM
JIM STUBBS, Vice Chair, Anchorage Fish and Game Advisory
Committee, Anchorage, AK, supported the reappointment of Mr.
Johnstone to the Board of Fisheries. The first board meeting he
attended was in 1983 and he hadn't missed one since, so he knew
what it takes to be a good board member and productive for the
state of Alaska. As he has seen board members come and go he has
noticed several things are critical to doing a good job: one is
they need to be a good listener. Mr. Johnstone is a very
approachable and a good listener. Another thing he noticed was
that the board needs a member that is well studied and well
versed on the issues; the history on the proposals and how they
go together is very complex.
4:02:59 PM
GREG ROCZICKA, representing himself, Bethel, AK, supported both
the appointment of both Mr. Johnstone and Mr. Huntington to the
Board of Fisheries. Mr. Roczicka said he had been involved in
resource management issues at every level for the last 25 years
including serving on the Board of Game for two terms in the 90s;
he is currently co-chair of the Kuskokwim River Salmon
Management Working Group, on the Lower Kuskokwim Fish and Game
Advisory Committee and the Federal Subsistence Council, and he
had the pleasure of working with them both. Even though you
don't always get your way and don't agree with all the
decisions, you are listened to, and if you have a good case, you
have a chance of getting them on your side. Mr. Huntington,
although new on the board, is a quick study, knows the issues
and will make an effective board member.
4:05:21 PM
LARRY ENGEL, representing himself, Palmer, AK, supported the
reappointment of Mr. Johnstone to the Board of Fisheries. He
spent 30 years with ADF&G attending Board of Fisheries meetings;
he served on the board for three terms. He had seen the good,
the bad and the ugly of members' abilities through the years and
one of the strengths of the board is that it is an open process
and easy for the public to get involved and evaluate the
performance of the board. This is where Mr. Johnstone stands out
amongst board members. He has the ability to articulate his
views and gather information from staff, testimony and various
committee processes, and very importantly can discuss it with
board members and explain the rationale clearly for his
decisions.
4:07:26 PM
TERRY ELLIS, representing himself and family, Wasilla, AK, said
they are simply users of the resource and supported Mr.
Johnstone's reappointment to the Board of Fisheries.
4:07:49 PM
AL BARRETTE, representing himself, Fairbanks, AK, said he was
not here to oppose Mr. Johnstone's confirmation, but to point
out that for the most part he is well prepared for meetings and
does listen to concerned persons, but he didn't hear all the
issues all the time or fully research all the statutes and
regulations, for the intent of proposals submitted to the board.
He "struggles somewhat" with subsistence law, Alaska Supreme
Court decisions in the five non-subsistence areas. The case in
point was the Chuitna personal use fishery. In 1978, the state
enacted rural priority; in 1982 the Board of Fisheries enacted
personal use and subsistence use regulations commonly known as
the "eight criteria" for finding a positive or a negative
finding for customary and traditional uses. In 1986, the
legislature enacted AS 16.05.258, subsistence uses for
allocation of fish and game which after a positive finding of
C&P, the board shall allocate by priority to who shall have
opportunity to harvest fish or game in times of shortage.
In 1990, the McDowell Alaska Supreme Court case said all
Alaskans are eligible to participate in subsistence. Thus, the
joint boards met in 1992 and enacted the five non-subsistence
areas. This was important because of Alaska Administrative Code
77.001 personal use regulations, clearly states that the present
areas of the state with harvestable surplus of fish in excess of
both spawning, escapement and present levels of subsistence,
commercial and sport uses, are the five non-subsistence areas
from 1992. It is necessary to establish fisheries classified as
personal use because since the sale of fish is not appropriate
or permissible, this fish cannot be classified as commercial.
Since the use is not customary and traditional use, this fishery
cannot be classified as subsistence. Chuitna red salmon have a
positive finding of C&P. They reside in the Chuitna areas
outside any of the five non-subsistence areas and the Board of
Fisheries and Mr. Johnstone continually struggle about making
that a subsistence fishery.
CO-CHAIR WAGONER thanked him and asked for questions. Finding
none, he went to the next speaker.
4:10:31 PM
ANDY SZCZESNY, representing himself, Soldotna, AK, supported the
reappointment of Mr. Johnstone to the Board of Fisheries,
because he is one of the brightest and most prepared board
member he had seen in 20 years. MR. Szczesny said he had been a
fly fishing guide for the last 27 years in Cooper Landing and
was appointed to the Board of Fisheries by Governor Knowles.
4:11:09 PM
STEVEN MCCLURE, representing himself, Soldotna, AK, supported
the reappointment of Mr. Johnstone to the Board of Fisheries. He
had been going to Cook Inlet meetings for the last 15 years and
he has had the opportunity to observe Mr. Johnstone at work. He
was extremely impressed with his knowledge, his fairness and his
resource first attitude.
4:11:49 PM
JOE CONNORS, representing himself, Sterling, AK, supported the
reappointment of Mr. Johnstone to the Board of Fisheries. He
supported all the previous comments about him and added that
what he like most was that he is very analytical and can break
through an argument. His leadership and expertise is just
amazing.
4:12:51 PM
GARY CHAMBERLIN, representing himself, Sterling, AK supported
the reappointment of Mr. Johnstone to the Board of Fisheries. He
had observed him at several meetings and he is very
knowledgeable about all the issues throughout the state and is
very conservation-minded.
CO-CHAIR WAGONER passed the gavel to CO-CHAIR PASKVAN.
4:13:44 PM
MONTE ROBERTS, representing himself, Soldotna, AK, supported the
reappointment of Mr. Johnstone to the Board of Fisheries. He had
lived in Soldotna for 20 years and had been very active in the
board for the last 15; he wanted to echo that Mr. Johnstone is
"very prepared" and "very accessible." He doesn't always agree
with you, but he will always listen to you and give you a chance
to explain your viewpoint.
4:14:17 PM
MURRAY FENTON, representing himself, Sterling, AK, supported the
reappointment of Mr. Johnstone to the Board of Fisheries,
because of his preparedness, accessibility and willingness to
listen.
4:15:01 PM
MIKE CRAWFORD, representing himself, Soldotna, AK, said he was
Chair of Kenai Soldotna Fish and Game Advisory Committee, and
supported Mr. Huntington and Mr. Johnstone's reappointment to
the Board of Fisheries. He has been effective as a chairman and
board member. He comes to meetings very well prepared and is
available before during and after the board meetings. The fact
that he is an attorney and a retired Superior Court judge brings
a wealth of information and knowledge to the board. His
experience as both a commercial and sport fisherman help him
understand the important issues.
MR. CRAWFORD said at first he questioned Mr. Huntington's stance
on aboriginal fishing rights, but after hearing in the House
Resources Committee how he supported them, he ended up
supporting him, too.
4:16:11 PM
STEVEN RUNYAN, Chair, Susitna Valley Advisory Committee, Palmer,
AK, supported Mr. Johnstone's reappointment to the Board of
Fisheries. He said the committee originally supported his
appointment and have seen nothing to change their minds. They
have been very pleased with his work on the board. He is serious
about making new and existing regulations compliant with MSY
principals, the Mason Stevens Act and Alaska Sustainable
Management Policy, all of which are difficult to understand.
Some past board members have treated them more as annoyances to
be dealt with rather than serious compliance.
For instance, Mr. Runyan said, at the last Cook Inlet meeting in
the interests of conservation he crafted a compromise that cut
fishing time in both commercial and sport fishing camps
regarding northern district Chinook salmon which have
drastically declined in recent years.
4:18:09 PM
BRUCE KNOWLES, member, Susitna Valley Fish and Game Advisory
Committee and MatSu Borough Game and Fish Commission, Willow,
AK, supported the reappointment of Mr. Johnstone to the Board of
Fisheries. He has brought forth what everyone has talked about
today; this new outlook is needed on the board.
4:18:52 PM
LORETTA BULLARD, Kawerak, Inc., Nome, AK, supported Mr.
Huntington's reappointment to the Board of Fisheries. Mr.
Huntington is a life-long Alaskan living mostly in the Interior
of the state; he has a Bachelor of Science degree in Wildlife
Biology and is very aware of the complicated fisheries,
management systems and issues that affect Interior and Western
Alaska, especial the Arctic/Yukon/Kuskokwim, which consists of
the Bering Straits Region, the AVCP and the Interior portion of
the state, the Doyon Region. They are very happy to see someone
with his background be appointed to this board as well as an
individual that is subsistence user who depends on the resources
for subsistence, not necessarily commercial or sports fishing.
In addition to Mr. Huntington's educational background, he would
bring many personal attributes to the board process; he is
respectful, knowledgeable, a team player, engaged, does his
homework and is dedicated to making the best management
decisions so that the state's fisheries will support Alaskans
for generations to come.
4:20:20 PM
RICHARD YAMADA, President, Juneau Charter Boat Operators
Association, Juneau, AK, supported the reappointment of Mr.
Johnstone to the Board of Fisheries. He could echo everything
positive said about Mr. Johnstone so far; he's fair and
knowledgeable about the fisheries.
4:21:29 PM
GEORGE PIERCE, representing himself, Kasilof, AK, did not
support the reappointment of Mr. Johnstone to the Board of
Fisheries. He asked if the committee noticed all the special
interest groups that are supporting him. He hadn't heard one
person say that he is qualified for the position. The board is
swayed by special interest groups and it needs people who are
biologists and scientists. Mr. Johnstone does not have any other
qualification besides being a judge.
4:23:36 PM
RON SOMERVILLE, board member, Territorial Sportsmen, Juneau, AK,
supported the reappointment of Mr. Johnstone to the Board of
Fisheries. He didn't know him personally, but his record is of
fairness. He does his homework and reads the information, which
is voluminous. He asked the committee to look at balance on the
board, not people who vote for sport fish or commercial fish;
people who vote their conscience based on science.
PAUL SHADURA, Executive Director, Kenai Peninsula Fishermen's
Association (KPFA), Soldotna, AK, was neutral on Mr. Johnstone's
reappointment to the Board of Fisheries saying it was due to
overemphasis in representation from one area of the state when
in so many other areas the stakeholders lack a voice. It was
their desire that they and the governor continue to strive for
even representation for all stakeholders on the board. They
strongly suggest that the board members state clearly their
reason for denying or limiting the fair and reasonable
opportunity of one group over another. The public has a right to
know how each member decides how to weigh the interests of one
user group over another.
At the March 2011 regulatory meeting, a decision was made that
he personally found to be lacking on the board's duty to be fair
and reasonable. He approached Mr. Johnstone and expressed his
confusion about the lack of process saying to him, "But you are
a judge." Mr. Johnstone turned and walked away, stopped and came
back to say he wasn't a judge any more. He said he didn't know
what that meant.
He said that KPFA supported Mr. Huntington's appointment to the
Board of Fisheries and the Governor's attempt to balance the
board and make it more responsive to different views within the
state.
4:28:41 PM
RIKI GEESE, Executive Director, Kenai River Sportfishing
Association, Soldotna, AK, supported the reappointment of Mr.
Johnstone to the Board of Fisheries and was neutral on Mr.
Huntington. Mr. Johnstone is extremely prepared at meetings and
has done some things to improve transparency of the process. He
instituted the "Committee of the Whole" where all board members
hear testimony for the more controversial items on the agenda
before going into deliberations and on more of the consent
agenda items going through the traditional committee process and
improved the procedures for the reconsideration process. His
experience as a judge facilitates questioning through public
testimony, department reports and through the committee process
of trying to get all the information on the table for board
members to make appropriate decisions from.
He said KRSA had not yet had the opportunity to talk with Mr.
Huntington, but he had talked to different people all were
impressed with his testimony at the House Fisheries Committee
about his approach of using science as the basis to make
decisions - making sure that the resource comes first and then
allocating any harvestable surplus to the user groups.
4:31:09 PM
BILL BROWN, Vice Chair, Board of Fisheries, strongly supported
Mr. Johnstone's reappointment to the Board of Fisheries. He met
Mr. Johnstone in 2008 and has served on the board with him for
four years; he knows him well. He is extremely well prepared; he
reads everything before the meeting - often as much as 2,000
pages of information before the meeting starts and another 1 or
2,000 pages once it starts. He is also extremely fair and
considers all sides of an issue. His unique background of both
commercial and sport fishing lets him see other points of view.
Every night he meets with the different interest group and works
out every morning before breakfast and then has breakfast with
interest groups.
As chair, he runs meetings efficiently and does everything to
get all the information. He is often on different sides of the
issue, but he understands why because he is good at explaining
his points of view.
MR. BROWN said it's vital for the board to have a broad
perspective. Some members have decades of commercial fishing
experience and members with history and knowledge of the
subsistence issues, members engaged in the sport fishing and
tourist industry. Members are from all over the state. Mr. Brown
said he brings his scientific knowledge and Mr. Johnstone brings
his legal expertise. Every year they get several lawsuits and
they need Karl to help them through them. They can't do without
him.
In the next year or two the board will have a big issue with the
Kootznoowoo lawsuit and Mr. Johnstone is already on top of that.
4:34:32 PM
REUBEN HANKE, representing himself, Soldotna, AK, supported the
reappointment of Mr. Johnstone to the Board of Fisheries. He re-
emphasized the fact that Chair Johnstone was making changes in
way the board does business. They are good changes that make the
meetings more open to the public.
4:35:34 PM
CO-CHAIR WAGONER closed the public hearing and took questions
from the committee.
SENATOR FRENCH said he had never heard such positive testimony
for a Board of Fisheries member before, but that a recent
question had been raised about where he lives because of travel
and hotel expenses during Anchorage meetings and he asked him to
address that issue.
MR. JOHNSTONE answered that as a judge he heard a lot about
residency issues and in his mind he has clearly been a resident
of Alaska since 1967. He has always voted in the state and
obtained a resident hunting and fishing license as well as
registered his cars in the state. He has owned homes in Alaska,
too, and has never done anything inconsistent with that. He has
a home in Arizona where he spends a big part of the winter,
because he has lost interest in the snow and coldness of
Anchorage. But he hasn't taken advantage of residency benefits
from the state of Arizona. His intent is to be a resident of
Alaska for the foreseeable future. He added that you can't
receive a Permanent Fund dividend unless you are a resident and
he has applied for and successfully received those dividends for
the last three years and has received them in the past as well.
Just because he has a winter home doesn't change the fact that
he is a resident; a lot of Alaskans have winter homes and retain
their residency. He went on to say that you have to be a
resident to serve on the board as well as being a registered
voter, and he qualified on both counts.
MR. JOHNSTONE commented that after receiving some expenses from
his first two board meetings in Petersburg and Sitka it became
apparent that his job, similar to the Senators' jobs during
session, doesn't start at 8 am and end at 5 pm; rather it starts
as early as 5 am when he has breakfast with stakeholders and the
public and continues meeting all day long. When he had his first
meeting in Anchorage, he asked the executive director what he
was supposed to do: stay in a hotel or go home. He answered that
it's not unique for people stay in a hotel and receive per diem;
and that is actually preferred, because they know his work
wouldn't stop at 5 and that he was expected to meet with people
to get information so he could make more informed decisions.
Kevin Brooks, director, Division of Administrative Services,
Alaska Department of Fish and Game (ADF&G), is the one who
issues these checks and authorizes a waiver for them. Mr.
Johnstone said he agrees with the policy.
4:41:46 PM
CO-CHAIR WAGONER asked if he uses a state credit card.
MR. JOHNSTONE answered yes; all board members are given a state
credit card and are authorized to charge certain things like a
hotel room. They can't charge meals, because they get per diem.
All he has ever used a state credit card for is the hotel.
CO-CHAIR WAGONER commented that not even legislators are given a
state credit card and he was somewhat shocked.
MR. JOHNSTONE said he could understand that. He added that often
in the middle of the winter he is in Arizona and when he attends
meetings, he pays for the roundtrip fare to Southeast Alaska,
and Anchorage; for meetings in Homer he pays the roundtrip fare
to Anchorage and is provided transportation to Homer.
SENATOR WIELECHOWSKI said a few years ago some committee members
were on the Cook Inlet Salmon Task Force and a big concern was
about getting more salmon to return to the Mat-Su drainages and
he wanted him to talk about how to do that.
4:44:09 PM
MR. JOHNSTONE replied that he wished he had a crystal ball. But
back in 1967 when he started fishing in the Valley, they would
close five or six of the Chinook streams because there was no
escapement and declare them stocks of concern. Little did he
think the sockeye fishery would be closed because the Yetna
because a stock of concern. In the March meeting in upper Cook
Inlet a year ago, they took some steps in terms of moving some
of the Kenai drift fleet out of spots where there were some
mixed stocks for a couple of periods, and moved them closer to
the terminal areas for the Kenai Kasilof to allow the sockeye
and some of the kings that might be co-mingled with the Kenai
Kings and Sockeyes to move up north. He didn't know the current
numbers and whether they achieved their goal, but the answer is
that for the most part the fish have been intercepted over the
historical periods of time. The board needs to make sure that
whatever they do that the stocks go up north and protect the
commercial fleets at the same time.
SENATOR WIELECHOWSKI said that the legislature doesn't get into
allocation issues, but it is a huge concern in his area.
MR. JOHNSTONE said he fully understood that.
CO-CHAIR PASKVAN commented about his professional contact with
Judge Johnstone many years ago saying that a committee was
formed and there was a rewriting of the mandatory disclosure
rules under the Civil Rules of Procedure. Secondarily, just
through extended family he knew Mr. Huntington who knows the
Yukon and Koyukuk river system.
4:47:30 PM
CO-CHAIR PASKVAN moved to forward names of the nominees, Karl
Johnstone and Orville Huntington, in accordance with AS
39.05.080 to a joint session of the legislature for
consideration. This does not reflect an intent by any of the
members to vote for or against the individuals in any further
sessions. There were no objections, and it was so ordered.
4:48:00 PM
Recess from 4:48 to 4:49 p.m.
HB 118-RESEARCH AND DEVELOPMENT TAX CREDIT
4:49:23 PM
CO-CHAIR WAGONER announced consideration of HB 118 [CSHB
118(FIN) was before the committee.
WYNETTA AYERS, director, Division of Economic Development,
Department of Commerce, Community and Economic Development
(DCCED), Juneau, AK, explained that HB 118 establishes a
research and development tax credit to incentivize innovation
and economic activity in the state. She said the DCCED and the
Department of Revenue (DOR) have provided a full presentation on
the bill in their packets. It includes letters of support and
additional documentation from the University of Alaska, a number
of seafood industry businesses and organizations, small
businesses, the financial services sector, entrepreneurs, the
aerospace industry and the minerals industry. These show wide
spread support for the creation of the research and development
(R&D) tax credit in Alaska.
4:51:19 PM
MS. AYERS said a tax credit can have far reaching benefits in
not only the core industries but new industries that might be
attracted to the state in the increasingly competitive global
marketplace. It will also position Alaska for new business
investment and take advantage of our climate, our global
position, our natural resources and human capital to bring this
new economic activity to our state.
She said that 38 other states already have a R&D tax credit or
some form of R&D incentive. By incentivizing the process and
product innovation, the state can create a business climate that
will help Alaska businesses grow and create well-paying jobs for
Alaskans. HB 118 seeks to position Alaska's economy and business
climate for diversification, growth and opportunity.
4:52:10 PM
JOHANNA BALES, Deputy Director, Tax Division, Department of
Revenue (DOR), explained the HB 118 allows each Alaska
corporation a tax credit of 20 percent of qualified R&D expenses
incurred in Alaska. It is only on an increased amount of R&D
activity in the state. For instance, if a taxpayer had conducted
research in Alaska in the past, the research activity they incur
going forward they would be allowed a credit on would be above
the average of the last three years. If they spent $1 million a
year in the last three years, the average would be $1 million a
year. If they spent only $900,000 in the next year, they
wouldn't be allowed a credit, but if they spent $1.1 million,
the credit would be 20 percent of the increased amount of
$100,000. Any unused portion of the credit could be carried
forward for seven years if they didn't have enough tax liability
to write it off in a particular year. production from last year.
MS. BALES said the research activities that would be allowed
would be those in the federal code, so all of the federal tax
structure would be in place allowing the state to "piggyback on"
to ensure that taxpayers are conducting qualified R&D. The
purpose would be discovering information that is technological
in nature, the application of which is intended to be useful in
the development of a new or improved component of the taxpayer,
and substantially all of the activities constitute a process of
experimentation.
CO-CHAIR WAGONER asked about a company with less than three
years of history.
MS. BALES answered that the period is three years, because they
are trying to entice companies to come up here. If they spent
$100,000 in the preceding year, it would be divided by three
(years).
SENATOR FRENCH stated that you can get it after your first year,
but it's based on a very small amount of money.
MS. BALES agreed.
SENATOR FRENCH said his packet has an amendment.
4:56:08 PM
SENATOR WIELECHOWSKI said he had the amendment drafted relating
to reporting and analysis of tax credits. This in an opportunity
to get more information about where credit money is being spent.
CO-CHAIR WAGONER held HB 118 in committee.
4:57:23 PM
Finding no further business to come before the committee Co-
Chair Wagoner adjourned the Senate Resources Standing Committee
meeting at 4:57 p.m.